Hong Kong records HK$2.9 billion consolidated surplus for 2025-26. Here’s how
South China Morning Post
by Lam Ka-singFebruary 26, 2026
AI-Generated Deep Dive Summary
Hong Kong has achieved an unexpected financial turnaround, recording a HK$2.9 billion consolidated surplus for the 2025-26 fiscal year, reversing earlier projections of a HK$67 billion deficit. This remarkable shift is attributed to a bustling IPO market and robust bond sales, which have bolstered the city’s financial health. Experts predict that this positive trajectory will likely continue into the next financial year, with economists expressing optimism about Hong Kong’s economic prospects.
The turnaround has been driven by strong stock market activity, with increased trading volumes and listing activities generating higher government revenues through stamp duty and other taxes. This surge in market activity was highlighted by Financial Secretary Paul Chan Mo-po during his budget speech, which revealed the unexpected surplus. The city’s property market is also stabilizing, further contributing to financial stability and reinforcing confidence in Hong Kong’s economy.
Analysts point to several factors underpinning this recovery. A vibrant IPO pipeline has attracted new companies and investors to the region, while bond sales have provided a steady stream of income for government coffers. Additionally, the transfer of funds between government accounts has played a significant role in achieving the surplus. Experts like Baptist University’s Billy Mak Sui-choi note that the stock market’s performance has been a key driver, with increased turnover directly boosting government revenue.
Looking ahead, economists are optimistic about Hong Kong’s economic outlook for 2026-27. A combination of sustained market activity, a recovering property sector, and continued financial stability is expected to reinforce higher tax revenues. This positive momentum is seen as a strong indicator of the city’s ability to maintain economic resilience in the face of global challenges.
Hong Kong’s financial recovery holds significant implications for its position as a global financial hub. The surplus not only highlights the city’s economic strength but also underscores its ability to attract investment and sustain market activity. As Hong Kong continues to navigate the complexities of the global economy, this financial turnaround signals a promising future for both local
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Originally published on South China Morning Post on 2/26/2026